Bella Evanglista, Jakarta – Health Minister Budi Gunadi Sadikin met with President Joko "Jokowi" Widodo to address concerns over drug and medical equipment prices in Indonesia, which are reportedly five times higher than in neighboring Malaysia.
Accompanying Minister Budi was Industry Minister Agus Gumiwang and Finance Minister Sri Mulyani Indrawati, summoned to strategize on the domestic pharmaceutical sector.
"The President emphasized two key points. Firstly, he urged for the alignment of medical devices and medicine prices with neighboring countries. Secondly, he stressed the need to fortify Indonesia's pharmaceutical and medical equipment industries against future pandemics," Minister Budi stated.
Factors contributing to the price hike, according to Budi, include inefficient trade routes, governance, and high taxes.
"We engaged Sri Mulyani to discuss tax reforms aimed at enhancing efficiency and simplicity without compromising government revenue, crucial for fiscal sustainability," he added.
President Jokowi has set a two-week deadline to resolve these issues, addressing inefficiencies in trade routes and governance contributing to rising drug prices.
Meanwhile, Finance Minister Sri Mulyani Indrawati assured that the Ministry would support and adjust to potential incentives for the pharmaceutical industry.
A 2024 survey by Indonesia's National Institute of Health Research and Development, Ministry of Health, revealed that generic drugs in both public and private sectors were priced approximately 2.5 times higher than the lowest priced equivalents. Many essential medications were deemed unaffordable, requiring up to 17 days' salary for the lowest-paid government workers.
Availability of lowest-priced generics stood at a low 47 percent in the public sector and 62 percent in the private sector, highlighting suboptimal accessibility. Local government procurement prices often exceeded international reference prices by 74 percent for lowest-priced generics, further complicating affordability challenges.